I think everyone except BMW NA knew this when they announced the price. Most people expected it to be priced no more than $2,000 at the most, with a lot of the sales people thinking less than $1,000 was appropriate.

I think BMW NA figured that with a $1,800 tax credit, they could charge a high price and essentially pocket the $1,800 for themselves, e.g., $3,700 minus the $1,800 tax credit equals a net ocst to the buyer of $1,900... right about where many though it should be priced.

BMW NA Marketing makes some really weird pricing decisions sometimes, e.g., when they launched the X3 it was priced way too close to the X5. And while reviewers generally like the new 1 series a lot, most are surprised by the high pricing compared to the 3 series, e.g., a lot of them believe that while the 1 series is great, it's probably worth the extra money to move up to the 3 series instead.